Indian automaker Maruti Suzuki has significantly reduced the production of its highly anticipated e-Vitara electric vehicles. The auto industry in nations dependent on China for critical rare earth materials now has to deal with delays and shortages. 

Western countries like the U.S., Japan, and parts of Europe have begun securing licenses from Beijing to resume supply chains, but India is still awaiting its approval, leaving its EV ambitions and Maruti Suzuki’s immediate production plans in an uncertain position.

India’s Maruti Suzuki is dialing back H1 goals

India’s leading automaker, Maruti Suzuki, has announced that it will significantly scale back the production of its much-anticipated electric vehicle (EV), the e-Vitara. This reduction in production is due to supply issues caused by China’s tightening of rare earth exports.

According to a company document reviewed by Reuters, the e-Vitara’s production targets for the first half of the year have been slashed by two-thirds from 26,500 units to just over 8,200.

The rare earth metals are essential for the production of magnets and other key components used in EVs, smartphones, and advanced military equipment. The global shortage of these materials is caused by export controls imposed by China, India’s fellow BRICS partner, and has caused disruption in several industries, including the clean energy and high-tech manufacturing industries.

Maruti’s internal document attributes the reduced production directly to the “supply constraints” surrounding these materials, although the company initially stated that the rare earth scarcity had no “material impact” on the e-Vitara’s production.

Under Maruti Suzuki’s revised plan, which was referred to internally as Plan B, the company intends to produce just 8,221 e-Vitaras from April to September 2025. The figure is significantly lower than the initially proposed 26,512 units in Plan A.

Despite this reduction, the company intends to hit its overall goal of manufacturing 67,000 EVs by the end of the financial year in March 2026 by ramping up production in the second half. Between October 2025 and March 2026, Maruti plans to produce approximately 58,728 units, which is a substantial increase from the original 40,437 planned for that period.

So far, Maruti has yet to begin bookings for the e-Vitara, which could be detrimental as Tesla is set to enter the Indian market later this year, and domestic competitors like Tata Motors and Mahindra & Mahindra are already dominating EV sales with feature-rich SUVs.

This delay could worsen Maruti’s market share, which has already declined from 51% in March 2020 to 41% currently.

India has high aspirations for its EV market

The e-Vitara was unveiled in January at India’s major auto show and was hailed as a cornerstone of Maruti Suzuki’s entry into the EV market.

The car’s launch is regarded as a critical step in seeing Prime Minister Narendra Modi’s vision of boosting electric vehicle adoption to 30% of all car sales by 2030 become a success. The rate of electric vehicle adoption was just 2.4% in 2024.

For Maruti Suzuki’s parent company, Suzuki Motor Corp., India remains its largest market by revenue and an increasingly important global manufacturing hub. The e-Vitara, produced in India, is an important part of Suzuki’s international EV strategy. Large volumes of the vehicle are marked for export to Europe and Japan starting in summer 2025.

In response to the intensifying competition and evolving market, Suzuki has already revised its long-term sales forecast for India. Originally, it targeted 3 million vehicles annually by 2031, but the company has now scaled that figure back to 2.5 million. Additionally, its EV rollout plans have been trimmed from six models to four.

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